March 2009

March 09, 2009

If it was the intention of the Ontario government to do as much damage as possible to the Toronto real estate market, then it has succeeded admirably in its goals. In fact, it has also succeeded even if that was not its intention.

First came the new City of Toronto Act, which allowed the city to impose the dreaded municipal land transfer tax.

Effectively doubling the provincial land transfer tax, the "Miller Bite" acted as a tsunami of ice water on Toronto's previously healthy real estate market.

Home sales have gone down every month since the tax came into force last year.

Next came Premier Dalton McGuinty's announcement in January of this year that the government is taking a "long hard look" at implementation of a harmonized sales tax, which would see provincial tax imposed on many items which are currently exempt.

If it is approved, buyers and sellers would have to pay provincial sales tax on newly built homes, legal fees, real estate commission, renovation services, land survey reports, home inspections, repairs and improvements.

Now comes the third blow to the real estate market – Energy Minister George Smitherman's proposed legislation to require an energy audit for residential units.

March 05, 2009

The Toronto Real Estate Board recorded 4,120 sales in February 2009 compared to 6,015 during the same month last year. The average price for the month dropped to $361,305 a 5% decline over the previous year.

March 04, 2009

The Ontario Municipal Board has decided that big box stores anchored by a Wal-mart have no place in Leslieville. The board said that Smart Centre’s proposals "do not constitute good planning" and "will very likely destabilize" the area. From the Toronto Star:

It included a variety of sizes of retail stores including the possibility of two large-scale units, with the largest being up to 180,000 square feet. Parking was set aside for more than 1,700 vehicles, but it would have been tucked in behind the buildings, not visible from the street or nearby residences.

No specific tenants were ever announced, but Wal-Mart was being courted to be an anchor tenant.

Residents in the neighbourhood were divided on the project, though a vocal opposition group emerged in the East Toronto Community Coalition, which appeared before the board hearing.

The city had argued the low-wage retail jobs were not what Toronto wanted, but rather higher-paying "creative industry" jobs in film or media.

March 03, 2009

Canadian house prices in December 2008 were down just .6% from a year earlier, according to the Teranet-National Bank House Price Index. Half the cities in the index showed a decline in prices over the previous year while the other half showed an increase in prices. Vancouver (-1.5%), Toronto (-.7%) and Calgary (-7.6%) all showed a decline in house values. Prices were up in Montreal (5.4%), Halifax (4.6%) and Ottawa (4.2%).

The following chart shows the House Price Index for the six cities tracked along with the national composite since January 2005.

March 02, 2009

The Ontario Court of Appeal has written what may well be the final chapter in what I call The Case of the $100,000 Fence.

The case involved a dispute over a strip of land between two houses on Johnston Ave. near Sheppard and Yonge in North Toronto.

Laura Cantera bought her house on that street back in 1997. Seven years later, in 2004, Wendy Eller and Paul Wright bought the property next door, intending to demolish it and build a new home on the lot. An old post and wire fence marked the boundary between the two houses, but unfortunately it was not on the deeded property line.

In fact, the fence was shown to be in the wrong position on a land survey done in 1952. Another survey report done in 1994 confirmed that the fence was still sitting well into the Eller and Wright property.

The south point of the disputed fence near the street line was 2.5 feet west of the real lot line, and the north point was 0.8 feet west of the line in the back yard.